This FAQ document is intended for informational purposes only. Refer to the policy and procedures for complete details.
Administrative and Design
CLIP was designed to be a policy rather than an endorsement to avoid the complications of simultaneously acting as an endorsement to multiple underlying RP policies.
CLIP provides a form of umbrella revenue coverage with a higher overall coverage level for two or more qualifying Revenue Protection (RP) policies. Diversification of risk across the covered commodities results in CLIP premium savings. Eligible commodities include barley (spring), canola (spring), corn, cotton, dry beans, dry peas, flax, grain sorghum, oats (spring), peanuts, popcorn, rice, soybeans, sunflowers, weaned calves, and wheat (spring).
CLIP coverage may be elected in 5 percent increments of 55, 60, 65, 70, 75, 80, and 85 percent. The CLIP coverage level must be at least as high as the highest applicable underlying RP policies’ coverage level and is subject to the coverage level cap. The coverage level cap is the lesser of 85 percent or the sum of the lowest coverage level percent for any underlying RP policy for the applicable RP crop or crop practice (i.e., irrigated and non-irrigated practice) or the High-Risk Land Exclusion Option (HRLEO) plus 25 percent.
A CLIP unit is a single unit containing all insurable acreage or number of head of the underlying RP crops insured under CLIP in the county for the insurance period. CLIP does not impact underlying RP policy unit structure. Underlying RP policy share arrangements apply to the CLIP calculations.
No, separate types and/or practices of an insurable crop are not considered separate crops under CLIP. Additionally, CLIP requires all insurable planted acreage of an underlying RP crop in the county to be insured under CLIP. For example, if a producer designates corn for CLIP coverage, both their irrigated and non-irrigated corn acreage in the county will be covered. However, producers can elect different RP coverage levels for the irrigated and non-irrigated acreage subject to the CLIP coverage level cap.
Written agreements are not allowed to modify the terms of the CLIP policy or to establish CLIP coverage where it is not available. However, written agreements are allowed on the underlying RP policies that may impact the coverage for an RP crop under CLIP.
Any eligible crop covered by an RP policy may be listed on the application if the CLIP policy is offered in the county. Eligibility is not based on planted acreage or number of head but rather on liability. It is not necessary to determine acreage or number of head at the time of application. The acreage or insurable head reported on the acreage report will be the basis for the actual CLIP liability for the crop and if the liability requirements are met. If no acreage of the crop is planted or there are no insurable head, then there is no CLIP liability or CLIP coverage for that crop.
If there is no CLIP liability (i.e., no insurable acres or head), there is no premium due. If applicable, the acreage report/record would be revised to show zero acreage or head, and the CLIP policy would be cancelled.
Since CLIP is one policy, there is only one administrative fee for CLIP per county regardless of the number of covered commodity policies.
Yes. BFR and VFR impact the underlying RP crop policies for the purpose of determining coverage and applicable benefits for the RP crops. The RP crop coverage for the producer is then used to administer the CLIP program.
Yes, CLIP can be elected at a coverage level equivalent to the highest coverage level of any of the underlying RP polies subject to the coverage level cap. For example, if an insured elects RP for corn at 80%, RP for soybeans at 70% and RP for cotton at 65%, they can elect CLIP at 80% (equivalent coverage level to corn).
There is no CLIP unit discount factor. The dynamic nature in which CLIP premium rates are calculated takes into consideration the commodity mix and liability variables for the policy without having a discount based on acreage brackets.
Eligibility and Requirements
The policyholder must have two or more underlying RP policies in the same county, each with at least 10% of the total RP crop liability of crops to be insured under CLIP.
The CLIP policy would be cancelled.
No, separate acreage and production reports are not applicable for CLIP. CLIP insurance coverage and policy administration will be based on accepted acreage reports for the insured’s underlying RP policies.
CLIP Interaction with Underlying RP Policies
CLIP is only available for use in conjunction with RP policies having a spring SCD (i.e., January 31 – March 15).
Yes, the CLIP policy is written on a county basis as is the case with all crop insurance policies, endorsements, options, etc. Accordingly, the underlying RP policies for which CLIP is written must be in the same county.
No, CLIP and the underlying RP policies must be with the same AIP and agency.
Yes, CLIP may be used with insurable types and practices available in the county for the RP crops.
Yes, the applicable adjustments for the underlying RP crops will carry over to CLIP.
Weaned Calf Risk Protection (WCRP) is the only livestock program eligible for CLIP. Programs such as Livestock Risk Protection (LRP) and Dairy Revenue Protection (DRP) are not eligible for CLIP.
No, CLIP can only be written with Revenue Protection (RP) policies.
No, CLIP can only be written with Revenue Protection (RP) policies.
CLIP utilizes the applicable projected and harvested prices and approved yields of the underlying RP policies.
On the earliest applicable sales closing date, the insured must elect CLIP and the CLIP coverage level and also designate the commodities to be covered by CLIP. The CLIP coverage level must be at least as high as the highest applicable underlying RP policy coverage level subject to the coverage level cap.
CLIP Interaction with Other Policies and Endorsements
No. The following endorsements may NOT be used with CLIP:
- Cottonseed Endorsement (SE),
- Downed Rice Endorsement (DC),
- Malting Barley Endorsement (MBE),
- Margin Protection (MP),
- Post Application Coverage Endorsement (PACE),
- STAX, and
- SCO.
Additionally, CLIP may NOT be elected for use with underlying RP policies with MBE, MP, PACE, STAX, or SCO.
Yes, CLIP may be used in conjunction with underlying RP policies with HIP-WI, ECO, or MCO. The HIP-WI Tropical Storm (TS) option is also allowable.
No, CLIP can only be used in conjunction with underlying RP policies (i.e., Plan 02). Since CAT is not offered for RP policies, CAT is not allowed.
No. Once CLIP has been elected for an underlying RP crop, election of an excluded supplemental coverage such as SCO is not available or permitted for that crop. Alternatively, if an excluded supplemental coverage such as SCO is in force for an underlying RP crop, CLIP may not be elected for that crop.
Yes, an AIP not offering WCRP may still offer CLIP for other crops.
No, the election of ARC or PLC on acreage does not impact the eligibility of an insured to elect CLIP.
No, they may elect HIP-WI for any or all of the underlying RP policies as long as it is allowable under the HIP-WI provisions. The same applies for ECO, HRLEO, and MCO.
Settlement of Claims
No, separate loss adjustment procedures are not applicable for CLIP. The loss adjustment procedures of the underlying RP policies are applicable for CLIP.
Any indemnity that may be due under CLIP will not be determined until all claim determinations for the insured’s underlying RP policies have been completed. CLIP does not affect timely claims settlement for underlying RP policies.
No, CLIP only provides coverage for insurable planted acreage.
CLIP may provide coverage at a higher coverage level than the underlying RP policies and such policies may not incur production or revenue losses. However, CLIP losses may still be available based on the higher CLIP coverage levels and will be determined using underlying RP policy loss adjustment procedures.